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World rice output projected to decline by 5 million tonnes, while consumption expected to hit a record high The global rice market is showing signs of tightening after more than a decade, with experts warning that lower production, rising demand, climate concerns and geopolitical tensions could push international rice prices higher in the coming months. Industry analysts believe the world may witness its first significant rice supply deficit in over 10 years. According to the latest estimates from the US Department of Agriculture (USDA), global rice production for the 2026-27 season (September–August) is forecast at 537.8 million tonnes, nearly 5 million tonnes lower than the previous season. If realised, this would mark the first decline in global rice production since 2015-16, ending an 11-year growth trend. Major output reductions are expected in India, Myanmar and the United States. At the same time, global rice consumption is projected to increase by 3.8 million tonnes to a record 541.4 million tonnes, driven by rising food demand in South Asia, Sub-Saharan Africa and other emerging economies. Consumption exceeding production may reduce global stockpiles and tighten supplies in international markets. Research agency BMI, part of Fitch Solutions, expects rice prices to maintain upward momentum throughout 2026. The agency estimates average rice prices could remain within $11.7–12.5 per cwt (45.36 kg), supported by increasing weather risks and higher fertiliser costs linked to ongoing geopolitical instability in the Middle East. Rising energy prices and concerns over fertiliser availability are adding pressure on farmers globally, especially in Asia where rice cultivation depends heavily on agricultural inputs. Weather uncertainty is emerging as another major concern. Experts warn that irregular rainfall patterns, drought risks and possible El Niño impacts may affect crop yields in leading rice-producing countries including India, Thailand and Southeast Asia. Lower planting intentions by farmers due to rising production costs could further tighten supplies. Despite lower production forecasts, India is expected to maintain its position as the world’s largest rice exporter. USDA estimates India’s rice exports could reach 25 million tonnes, supported by strong domestic stocks and competitive pricing. India’s large inventories may help moderate sharp price spikes in the global market. Market observers believe the widening gap between production and consumption could keep rice prices firm over the medium term, impacting importing nations and increasing concerns over global food inflation and food security.